Under the new Philippine sustainability reporting law, the Philippines will require publicly listed companies to submit mandatory sustainability reports by 2026, aligning with global standards and boosting corporate accountability.
The Securities and Exchange Commission (SEC) will implement the Philippine sustainability reporting law for publicly listed companies starting in 2026. This move aims to align corporate disclosures with international sustainability standards and ensure transparency on environmental, social, and governance (ESG) matters. Companies are encouraged to look to the best sustainability reports with key ESG metrics as benchmarks for building credible and comprehensive disclosures that meet global expectations.
The SEC plans to introduce the new rules gradually to ease the transition. This year, a market readiness study will assess the challenges companies may face. The study will help determine if businesses need temporary exemptions and how the framework should be structured for companies of different sizes.
The new requirements will be based on guidelines from the International Sustainability Standards Board (ISSB), which sets global standards for sustainability reporting. Companies must submit evidence of compliance by 2028, ensuring full adoption of the Philippine sustainability reporting law by 2030.
In partnership with the Philippine Stock Exchange (PSE), the SEC has been working with publicly listed companies and sustainability experts to prepare for the shift. At the 11th Annual SEC-PSE Corporate Governance Forum in November 2024, discussions centered on the role of corporate governance in climate resiliency and regulatory updates on sustainability reporting. Experts from the Global Reporting Initiative (GRI), the Philippine Sustainability Reporting Committee, and the Institute of Corporate Directors provided insights into the evolving sustainability landscape.
One key update from the forum was the upcoming revision of the GRI Standards in 2025. These updates will expand climate-related disclosures to include climate change impacts, greenhouse gas (GHG) emissions reduction targets, GHG removals, and carbon credits. The Philippine Sustainability Reporting Committee also introduced new guidelines based on IFRS S1 and S2, focusing on sustainability-related risks and opportunities (SRROs) and materiality assessments for corporate disclosures.
The SEC has adjusted its timeline for implementing the Sustainability Reporting (SuRe) Form. Initially set for 2025, the rollout has been postponed, and the SEC will continue using its existing sustainability reporting guidelines for the fiscal year 2024. The SEC has proposed a phased approach to implementing the Philippine sustainability reporting law. Large capital-listed companies (Tier 1) must comply in 2026, followed by mid-sized firms (Tier 2) in 2027 and small to medium enterprises (Tier 3) in 2028.
The SEC also plans to introduce limited assurance requirements for publicly listed companies to ensure reporting accuracy. Tier 1 firms must comply by 2028, while Tier 2 and Tier 3 firms will follow in 2029 and 2030. Limited assurance is a verification process designed to enhance the credibility of sustainability reports, ensuring that disclosed data is accurate and reliable.
The SEC is also digitizing the reporting process. A web-based platform, the SEC SuRe Framework Application, is set to launch in the coming months. Developed in collaboration with climate analytics company Komunidad, the platform will allow companies to submit their sustainability reports digitally. This shift will enable the SEC to manage, monitor, and verify submissions. The platform will also include tools for ESG management, climate risk assessment, social impact analysis, and online training resources for businesses.
The Philippines is among the last Southeast Asian nations to implement mandatory sustainability reporting. Countries like Malaysia, Vietnam, Singapore, Thailand, and Indonesia have already established sustainability disclosure requirements for listed firms. Malaysia has required public companies to report sustainability data since 2016 and extended the mandate to large private firms last year. Singapore introduced climate reporting requirements in 2024, while Thailand and Indonesia implemented similar rules in recent years. The Philippines, Cambodia, Myanmar, Laos, and Timor-Leste remain among the few nations in the region still transitioning to mandatory ESG disclosures.
Mandatory sustainability reporting can benefit both businesses and investors. It provides a clear framework for companies to track ESG performance, improve corporate governance, and attract socially responsible investors. More vigorous sustainability reporting can boost financial market stability by giving investors better insights into corporate risks and long-term viability.
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Transparent ESG disclosures help investors assess their investments’ sustainability and ethical impact. As global investors increasingly prioritize ESG factors, the Philippine sustainability reporting law aligns the country with international trends and enhances its competitiveness in financial markets.
Meanwhile, Greenpeace Philippines and climate-impacted communities have lauded the SEC’s announcement. They believe this is a crucial step in holding corporations accountable for their contributions to climate change. This move follows calls from survivors of Super Typhoon Haiyan (Yolanda) in 2013, particularly those from Salcedo, Eastern Samar, who urged the SEC to enforce stricter climate-related disclosures.
Greenpeace welcomed the announcement but emphasized that it should be only the first step toward stronger regulations, including the passage of the Climate Accountability Bill (CLIMA Bill). The organization believes mandatory reporting will hold companies accountable and benefit them by addressing climate risks and fostering proactive climate action. For communities facing increasing climate-related challenges, such measures offer hope for greater transparency and corporate responsibility in mitigating the impacts of climate change.
The SEC will continue monitoring regional best practices to refine its approach and ensure a smooth transition for businesses. As the 2026 deadline approaches, companies are encouraged to start preparing now. Those who embrace sustainability reporting early will likely have a competitive advantage in attracting investors and maintaining regulatory compliance.
